EUR analysis 22.01.2020

The single currency fluctuated the euro in a narrow range slanting upward during the Asian session to witness its rebound from the lowest since December 24 last against the US dollar amid the scarcity of economic data by the economies of the euro area and on the cusp of developments and economic data expected today Wednesday by the American economy The world's largest economy and the shadow of the World Economic Forum Davos in Switzerland.

At 05:27 am GMT, the euro pair rose against the US dollar by 0.02% to 1.1084 levels compared to the opening levels at 1.1082, after the pair achieved its highest level during the trading session at 1.1087, while achieving the lowest in a month at 1.1077.

Investors are currently looking for the US economy to disclose housing market data with the release of the house price index, which may show an acceleration of growth to 0.3% compared to 0.2% last October, before we witness the release of the existing home sales index, which may indicate an increase 1.5% to 5.43 million homes, compared to a decline of 1.7% at 5.35 million homes last November.

It is noteworthy that US President Donald Trump praised yesterday during the events of the World Economic Forum in Davos, the administration’s commercial deals and economic achievements for his country, noting the trade agreements concluded with China, Mexico and Canada, with his statement that the second stage of the trade agreement between Washington and Beijing will begin Soon, tariffs existed during the second-stage talks, adding that there was a good relationship with his Chinese counterpart.

In the same context, US President Trump warned that his administration will impose 25% customs duties on European cars in the event that a fair trade agreement has not been reached between Washington and Brussels, while threatening to impose 100% customs duties on French wine, and told him that France will stop imposing duties On the Internet companies at the moment and that he had no intention of meeting with the Ukrainian Prime Minister on the forum.

The remarks of the Republican President came during the Davos activities, which included his criticism of the Federal Reserve for being weakly reducing interest, in conjunction with the Republican majority of the Republican majority began the forty-fifth session of the US President's trial that aims to remove him from office following the accusations leveled against him by the House of Representatives Democratic majority, against the backdrop of his leaked phone call to the Ukrainian Prime Minister.

In another context, we also followed yesterday, US Treasury Secretary Stephen Minnows expressed during the Davos events, that the second stage of the trade agreement between his country and China will not include the abolition of customs tariffs in full, and that the first part of the second stage may include the postponement of some tariffs, with a warning to each From Italy and Britain who will face US tariffs if they continue to impose a digital tax on companies such as Google and Facebook.

The warnings of the US Treasury Secretary Minution to both Italy and Britain came after France retreated from imposing a tax and Paris and Washington pledged to avoid the outbreak of a trade war between them until the end of this year at least, while he noted that the growth prospects for his country for this year are very low, with his statement that recent trade deals It will support the pace of growth, adding that US trade challenges will not affect the pace of global economic growth.

Technical analysis

The euro against the dollar presented positive trades yesterday, but it collided with a strong resistance barrier formed by the EMA50, to bounce back and test the support of the bullish channel again, accompanied by the entry of the stochastic index to the oversold areas in the sale, waiting for the price stimulus to resume the bullish bias during the upcoming sessions to head towards 1.1180 That represents our first positive goal.

Consequently, we will maintain our bullish expectations for today, provided stability above 1.1065, as breaking it will press the price to achieve an additional drop targeting the 1.0985 level as a next negative station.

The expected trading range for today is between 1.1040 support and 1.1180 resistance.

Expected trend for today: bullish.